Bitcoin, Crypto currency, Blockchain

Floyd Mayweather Jr. and DJ Khaled by the SEC, convicted of fraud

465cd5e0a0712d7aaba0ba67cdd98216 - Floyd Mayweather Jr. and DJ Khaled by the SEC, convicted of fraud

In the crypto-world is you easy prey for fraudsters. One of the reasons is that most of these scams are never pursued due to lack of laws and regulations. ICOs are particularly vulnerable, since they are not clearly defined, and hence no requirements have to comply with. Many of the ICO-investors have lost large sums of money, since most of the Coins and tokens of these ICOs have no functioning end-product, and thus worthless. As recent developments show, the situation could change soon, as the regulatory authorities want to buckle the belt around the crypto-market close. It has been suggested that the ICOs were the reason for this is that Thailand against the crypto-trade is taken. Also China has recently prohibited the implementation of ICOs temporarily. Singapore has issued a ICO-a Best Practice guide for investors and the SEC (Securities and Exchange Comission) has established currencies, a Cyber-unit for the investigation of fraudulent behavior in the field of Crypto.

The existing laws are vaguely formulated and give law enforcement authorities a lot of Power. The authorities are doing but with the current, existing laws everything what is in your Power, and push at the same time explicitly on more laws. The times are changing but definitely, as the crypto currencies were at the beginning, flew in the crypto-Ecosystem is still under the Radar of the governments.

The SEC goes against DJ Khaled and Floyd Mayweather Jr. before

The music producer DJ Khaled, and the professional boxer Floyd Mayweather Jr. were accused, because they have not disclosed that they were paid for the Promotion of ICOs, which meant that their Fans could accept that they were actually convinced of the projects and have also invested, while the whole thing was just a paid Promotion. It is interesting to note, however, that the two were not convicted of securities fraud, but only because the did not disclose that the whole thing was just a paid advertisement. Floyd Mayweather has advertised three ICOs. It is Centra Token (CTR), Hubiit (HBT) and Stox (STX). Centra Token promised the users of crypto to provide debit cards that could be used at all VISA/Mastercard acceptance points. The founder of Centra have been arrested and their assets seized.

While Hubiit is a platform to Manage digital Content and Stox an Online betting platform, are traded these tokens. The co-founder of Centra Tech Inc, Robert Farkas and Sohrah’Sam‘ Sharm, were charged with fraud relating to the securities. In September of 2017, Mayweather told his 13.5 million Facebook Fans, that you should Centra-buy Token. “Get yours before they are sold out“. He also said: “I have already, and as always, I will win with this Investment properly!“. From the Outside, it seemed as if Mayweather quite the crypto-fever. Mayweather agreed to pay a total of 614.775$, of which a$ 300,000 compensation, a$ 300,000 penalty and 14.775 court fees. Similarly, Khaled agreed to pay 152.725$, of which$ 50,000 in damages,$ 100,000 fine and 2,725 existing$ court fees.

Mayweather also agreed to apply for a period of three years, no digital or other securities. Khaled has stated that in addition to a similar ban for two years, ready to cooperate with the SEC for ongoing investigations continue. This case represents the first of the SEC, in the charge of ICOs was collected. In a similar case, the SEC was denied a restraining order to assets in the crypto-Startups-took Blockvest for alleged violations of the securities laws, to the hardware. The judge stated in the verdict that the SEC could not prove that Blockvest – or the founder, Reginald Buddy Ringgold against securities violated laws, therefore, the injunction was refused. Blockvest and Ringgold was accused of falsely claiming that the regulatory authority have approved the token sale. The SEC initiated in mid-October a study to investigate this matter. Interesting way to Blockvest that there was error on his part, but defended that they were not intended, and thus, no capital is procured. They also noted that they sold no securities. So a victory for the SEC.

The investors are now safe?

All of this represents a big step, and the SEC is not likely to stop. In the coming months there will be more investigations and much more ICOs to be in trouble. This will make a major contribution to the prevention of fraud to investors, and the ICOs and their Stakeholders need to be more careful. Other countries will follow the example of the investors trust. In addition, the investors could finally give the possibility to solve disputes, which may arise from dealing with ICOs.

Disclaimer: Because of the buying and trading crypto-currencies with a significant risk of loss goes hand in hand, we speak of crypto Ticker not a recommendation to buy. Please inform yourself thoroughly, comprehensively and, above all, independently from various sources that you trust before the acquisition of a crypto-currency.

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